Posted by Mumbai: Indian government plans to regulate cryptocurrencies as assets and not ban them through bills in the Parliament. But for Mukesh Ambani, Anand Rathi and other businessmen it’s the underlying blockchain technology of cryptocurrencies more valuable and significant than crypto.
Blockchain technology different from cryptocurrencies
“I believe in blockchain technology and this is different from cryptocurrency. Blockchain is very important for a trust-based, equitable society,” Reliance Industries Chairman and MD Mukesh Ambani said addressing the Infinity Forum, hosted by International Financial Services Centres Authority (IFSCA) last week.
Citing RBI Governor Shaktikanta Das, Ambani said that Das is among those who feel that the blockchain technology underpinning cryptocurrencies could exist on its own, even without the currency.
“Using blockchain, we can deliver unprecedented security, trust, automation and efficiency to almost any type of transaction. I think that smart token is making sure that you are creating transactions that can never be changed,” he continued.
Modernizing supply chains with blockchain technology
Blockchain can play a role to modernize the supply chains of economies, according to Ambani. With India having digital infrastructure and the regulatory framework in place, he said that the country is now well on its way to transforming itself into a leading digital society.
“It is a very important framework for trust-based transactions and trust-based society, which is a prerequisite for all of us,” Ambani explained how blockchain’s role is important in secure transactions.
Decentralized Financial sector with technology convergence
Ambani emphasized that technology convergence will redefine the decentralized financial sector unseen before.
“I think that the convergence of real-time, the convergence of the distributed ledger and blockchain technologies, smart tokens, the convergence of physical and digital through IoT will enable and will redefine the decentralized financial sector in a way that we have never imagined,” he said.
In his opinion, the technology convergence will redefine the decentralised financial sector in the next 10 years and this will be a prerequisite to great economic growth.
As a strong believer in blockchain technology, Ambani said that it could help in building innovative solutions to handle the working capital needs of lakhs of merchants and credit scores in real-time.
Interestingly, it is not just Ambani, who believes and has backed blockchain technology publicly. In fact, Anand Rathi Wealth Founder and Chairman Anand Rathi said that blockchain technology holds great promise.
Blockchain technology holds great promise
“We believe that while the underlying blockchain technology of crypto holds great promise, most cryptos themselves have no inherent underlying value,” Rathi told ETMarkets.com in an interview.
“The current value is merely derived from the belief that someone else will be willing to pay a greater price down the road,” Rathi replied when asked If cryptocurrencies are categorised as an asset class in the upcoming bill.
“This matter is under consideration of various governments for creating a regulatory framework and only then there will be greater clarity about its use as an investment,” Rathi added.
Early this year, the Indian government decided to make it mandatory for companies to disclose investments made in cryptocurrencies.
As far as crypto is concerned, according to a Kaspersky study titled Uncharted territory: why consumers are still wary about adopting cryptocurrency revealed there’s a lack of understanding and trust, which is holding consumers back from using cryptocurrencies. The study found that only just one in ten (10%) of consumers actually fully understand and know how cryptocurrencies work.